Mr. Donohue predicts a future in which compliance expenses increase significantly. He does not acknowledge, however, the problems that rising costs may cause our economy and society. This is not to decry regulation in general; one does not have to be a libertarian to acknowledge that regulation's costs sometimes can outweigh its benefits. It should be clear, however, that as regulatory costs rise, (i) there is a reduction in services or an increase in the cost of those services, and (ii)…

All firms, particularly regulated firms, that invest in SEC-registered money market funds should ensure that they have procedures in place to distinguish between funds that have the right to suspend redemptions and funds that do not. Firms that invest in the former may have to take material capital charges or face other regulatory and liquidity issues.

The bottom line of ISDA's analysis is that, (i) despite all of the outcry about too-big-to-fail, regulatory costs weigh most heavily on smaller institutions, whether buy-side or sell-side, and (ii) increasing the costs of entering into derivatives transactions makes hedging more expensive, which increases risk in the economy generally, even if the risk of derivatives specifically is decreased. To put this in practical terms, if a small firm is prevented from hedging with derivatives in a way…

Perhaps these sports games are a bad thing, and perhaps they should be prohibited, but the notion that they are illegal because they are swaps shows how absurd Dodd-Frank's definition of "security-based swap" really is. The breadth of the definition, however, is less of a problem on the securities side (because it only picks up contracts relating to securities) than it is on that of the Commodity Exchange Act, where, in theory, the definition includes a contract relating to any event of…